EMPLOYMENT & WORKPLACE LAW MID-YEAR … & WORKPLACE LAW MID-YEAR REVIEW 2014 AUTHORS: John Tuck (Partner), ... SPC Ardmona and Qantas came under increased scrutiny

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MAJOR HEADING

EMPLOYMENT & WORKPLACE LAW

MID-YEAR REVIEW 2014

WWW.CORRS.COM.AU

AUTHORS:

John Tuck (Partner), Nick Le Mare (Partner), Stephen Price (Partner), Jack de Flamingh (Partner),

Simon Billing (Partner), Nick Ellery (Partner), Jane Hall (Partner), Janine Young (Partner),

Heidi Roberts (Partner), Anthony Forsyth (Consultant).

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INTRODUCTION

This is our first annual review of employment and workplace laws in Australia. We look at developments from the perspective of employers in Australia and the challenges that they face in the current economic climate. In considering these issues we have taken the opportunity to gather a range of data that shapes the environment in which employers operate and make decisions.

Work is a critical piece of our economy and of our society; the quality of the work, the productivity of our labour and the number of available jobs are all central to Australia’s health as a nation. It is for these reasons the workplace and the laws that govern it are so often central to our political debate.

Today, in the aftermath of the minerals price boom the focus is on the productivity performance of Australia. It is not a simple debate. The recent massive investment in our resources sector is now delivering an uplift in productivity in that sector from the enormous capital investment. However, this can disguise the weaker productivity performance in other parts of our economy that are our largest employing sectors – health, aged care, construction and education. The resources story can muddy the waters over what Australia now needs by way of workplace laws to positively contribute to more demanding times with lower minerals’ prices, an ageing nation, a dollar doggedly clinging to historically high levels and critical infrastructure upgrades facing our major cities.

The last major national political contest that had our workplace laws at the core was almost seven years ago during the 2007 federal election over WorkChoices. The introduction of new workplace laws were part of the promise of 2007 leading to the Fair Work Act 2009 (Cth) (FW Act). However, this was before the global financial crisis and the China resources boom peaking in 2011. Whether these laws suit a new economic environment will soon be considered by the Productivity Commission Inquiry into the workplace relations framework due to report in April 2015.

In this context we look at the 2013-2014 financial year and the major developments in Australian employment and workplace relations law.

The most significant change was the election of the Abbott Coalition Government at the federal level in September 2013. Since then, the Government has been implementing its reform agenda, including proposed amendments to the FW Act; legislation to restore the Australian Building and Construction Commission (ABCC); and increased regulation of trade unions.

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In February 2014, the Government established the Royal Commission into Trade Union Governance and Corruption (Trade Unions Royal Commission). Hearings of the Royal Commission commenced in April, and will continue throughout the year with a report to the Government due by 31 December 2014.

In the period since the Coalition took office, the industrial relations debate has shifted with employer groups stepping up their lobbying to wind back award penalty rates (particularly in respect to weekend work), unfair dismissal protections and union-centred collective bargaining. In the first few months of 2014, union agreements at Toyota, SPC Ardmona and Qantas came under increased scrutiny in the context of discussion over the survival prospects of these companies – and the Government’s decision to reduce industry assistance. These examples raised the issue of whether our workplaces are flexible enough within the current workplace laws to react to changing demands.

In this extended Corrs Workplace Relations Thinking Piece, we examine these issues and other key workplace relations and employment law developments over the past year, including the commencement of the Fair Work Commission (FWC)’s new anti-bullying jurisdiction on 1 January 2014. Significant court and tribunal decisions are also analysed.

We then look ahead and identify the issues that are likely to be a central focus in Australian employment relations over the next 12 months, chief among them the imminent Productivity Commission review of the FW Act and related legislation.

“In Australia’s high-wage environment, when an oil industry worker is paid approximately 130 per cent of the American Gulf Coast benchmark, we need to refocus on maximising effective hours at work. A first positive step would be to eliminate unproductive clauses in enterprise agreements... When high labour costs are coupled with inefficient workplaces, international capital recoils, and looks for more attractive investment destinations.”

Andrew Smith, Shell Chairman, CEDA Conference, Canberra – quoted in “Shell boss blasts Fair Work Act”, AFR, 24 June 2014

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EMPLOYMENT & WORKPLACE LAWMID-YEAR REVIEW 2014

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AUSTRALIA’S ECONOMIC PERFORMANCE AND KEY

INDUSTRIAL RELATIONS DATA

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We begin by looking at some economic indicators and industrial relations statistics which inform the debate over workplace reform.

Economic GrowthThe Government stated in its first Budget in May 2014 that:

The Australian economy is in the midst of a major transformation, moving from growth led by investment in resources projects to broader-based drivers of activity in the non-resources sectors. This is occurring at a time when the economy has generally been growing below its trend rate and the unemployment rate has been rising.1

GDP growth picked up in the second half of 2013, with annual GDP in the year to the December quarter 2013 at 2.8% (slightly below trend growth levels). The following graph shows Australia’s economic growth performance over the past decade:

Australian economic growth ratesPercent

6

5

4

3

2

1

0

-1Dec 03 Dec 09Dec 04 Dec 10Dec 05 Dec 11Dec 06 Dec 12Dec 07 Dec 13Dec 08

Non-farm GDP (quarterly) Non-farm GDP (annual)GDP (quarterly) GDP (annual)

Reproduced from the FWC decision in Annual Wage Review 2013-14 [2014] FWCFB 3500 (4 June 2014) at [129]. Original source: Australian Bureau of Statistics (ABS), Australian National Accounts: National Income, Expenditure and Product, Dec 2013, Cat No 5206.0.

Australia continued to outperform the OECD Major 7 Countries (USA, Japan, Germany, France, Italy, UK, Canada) in GDP growth, a trend which has been maintained since the global financial crisis.2

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AUSTRALIA’S ECONOMIC PERFORMANCE AND KEY INDUSTRIAL RELATIONS DATA

Overall business investment peaked at over 18% of GDP in 2013, its highest level in more than 50 years.

However, the contribution of non-mining and public investment to GDP remains relatively low, with the manufacturing and tourism sectors the weakest performers.3 The RBA considered that Australia’s high exchange rate and low business confidence in the latter half of 2013 largely explained these results.4

Employment LevelsThe federal Budget papers indicated that the Australian labour market has been subdued since late 2011, with weak employment growth, a falling participation rate and a rising unemployment rate.5 ABS data indicated an unemployment rate of 5.8% (seasonally adjusted) in May 2014,6 rising to 6% in June (despite the addition of almost 16,000 new jobs).7 Unexpectedly, the unemployment rate shot up to 6.4% in July, its highest level in 12 years and the first time since 2007 that unemployment levels have been higher in Australia than in the USA. The following graph shows longer-terms trends in both the unemployment and participation rates:

Australian unemployment and participation ratesPercent

81

79

77

75

73

71

69

67

65

63

8.0

7.5

7.0

6.5

6.0

5.5

5.0

4.5

4.0

3.5

Dec 02 Dec 05 Dec 09Dec 03 Dec 06 Dec 10 Dec 12Dec 04 Dec 08Dec 07 Dec 11 Dec 13

20-64 Participation rate (LHS)15+ Participation rate (LHS) Unemployment rate (RHS)

Percent

Reproduced from Annual Wage Review 2013-14 [2014] FWCFB 3500 (4 June 2014) at [212]. Original source: ABS, Labour Force, Australia, Apr 2014, Cat No 6202.0; ABS, Labour Force, Australia, Detailed—Electronic Delivery, Apr 2014, Cat No 6291.0.55.001.

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These concerning rates are part of the debate for less regulation around unfair dismissal laws and greater flexibility in the workplace.

The surge in investment in the resource sectors (especially iron ore, coal and liquefied natural gas extraction) saw the total employment share of these sectors double from the mid-2000s, reaching around 9.75% in 2011-12, with significant growth also in resource-related industries such as construction.9 However, the shift in the last two years from the investment phase to the production/export phase of the mining boom has led to a reduction in employment levels. It is estimated that the resources industry construction workforce will fall from a peak of almost 86,000 in 2013 to under 8,000 by 2018.10

There is now space to reflect on the performance of this sector during the construction phase, and to plan for the next important investments that still need to be made in energy and resources. The causes behind very high wage demands and the role of restrictive greenfield agreement making options must be seriously assessed. What seems unarguable is that the cost of building new infrastructure in Australia is a significant barrier to investment. These costs contribute to the difficulties in delivering these major projects along with the restrictive labour arrangement options.

Wages and ProductivityWhile the political debate over the last 12 months has focused heavily on Australia’s comparatively high wages and poor productivity performance, the statistics present a mixed outcome for workers.

ABS wage price index (WPI) figures show that private sector pay rates fell to their lowest level since data was first collected in 1997, recording 2.5% growth in the year ending March 2014 (just below the inflation rate).11 Mining wages growth was 3.1% (down from 5.1% in 2012); utilities and waste services workers obtained the biggest pay rises at 3.3%; while professional, scientific and technical services staff averaged only 1.6 increases.12 These trends were continued in the June quarter 2014, showing annualised wages growth still at 2.5%. This was the fifth consecutive quarter in which the ABS data showed annual wages growth below 3% across the economy, and in the private sector.

The Department of Employment’s Trends in Federal Enterprise Bargaining series showed average annualised wage increases (AAWI) in private sector enterprise agreements running at 3.6% in the March quarter 2014. Wage increases were highest in the health and community services sector (3.8%), and at the lower end (3.1%) in manufacturing. Public sector pay rises averaged 3.4% in the same period.13 The following chart compares the AAWI and WPI data over the last three years:

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AAWI (Department of Employment) and WPI (ABS) data on wage increases, March quarter 2011 to March quarter 2014

DECEMBER QUARTER 2013 (%)

MARCH QUARTER 2014 (%)

CHANGE IN AAWI % POINTS

Collective agreements approved in the quarter

All sectors 3.5 3.7 0.2

Private sector 3.6 3.6 0.0

Public sector 3.4 3.9 0.5

All current wage agreements

All sectors 3.7 3.6 -0.1

Private sector 3.7 3.7 0.0

Public sector 3.4 3.5 0.1

Source: Department of Employment, Trends in Enterprise Bargaining Report, March Quarter 2014.

In late January, Employment Minister Senator Eric Abetz argued that Australia risks a 1970s-style wages explosion because of unsustainable wage increases in key sectors including the construction, maritime and manufacturing industries. The Minister pointed to what he described as flaws in the current workplace relations framework, which allow unions and employers to act irresponsibly in reaching inflated wage deals that end up costing jobs (eg Holden, Toyota).14 One observation is that almost two decades of bargaining with an embedded approach of percentage based wage claims have led to base rates that are not competitive. The cumulative effect of wage increases in excess of CPI is now at unsustainable levels for a number of industries and sectors.

The FWC’s decision in May 2014 to increase the federal minimum wage by 3% ($18.70 per week) led to intensified debate over Australian wage levels. The FWC Minimum Wage Panel based its decision to raise the minimum rate of pay to $16.87 per hour ($640.90 per week) on what it saw as Australia’s sound economic performance and outlook, including:13

• solid economic growth at the aggregate level.

• an increase in labour productivity “by a total of 7.6 per cent over the past three years and by 1.9 per cent in the last year. This growth in labour productivity is not confined to mining.”

• reasonable labour market performance “both in terms of employment growth and a recent stabilisation of unemployment levels. Some aspects of labour market


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performance, especially weak growth in hours worked, continuing high youth unemployment and a falling full-time employment to population ratio for the working age population, are a cause for concern.”

• “moderate” inflation and “benign” wages growth: “Real unit labour costs remain at historically low levels.”

• increases in the profit share and the gross operating surplus of companies, although with limited growth in the non-mining sector in aggregate.

• “no evidence of unusual levels of business failure.”

The decision was strongly criticised by the Coalition Government, employer groups and the financial press. For example it was claimed that the FWC’s 3% increase meant Australia is saddled with “the world’s highest minimum wage in US dollar terms and the third-highest on a purchasing-power parity basis.” 16

Leading the packGlobal minimum wages ($US per month)

Australia

Luxembourg

New Zealand

Belgium

Netherlands

Ireland

France

Germany*

UK

Canada (Alberta)

US

Spain

Greece

Brazil

Russia

India^

Nigeria

2576

2548

2082

2042

1988

1988

1945

1903

1739

1575

1257

1024

930

318

111

151

136

* Legislated for introduction 2015 ^Unskilled rate SOURCE: EUROSTAT, NATIONAL AGENCIES

Reproduced from Luke Malpass, “Fear minimum wage will reduce Australia’s competitiveness”, AFR, 5 June 2014.

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These concerns were linked with those over Australia’s productivity performance. The nature of Australia’s productivity crisis is a hotly contested issue. For example Prime Minister Abbott asserted in March 2014 that Australia had come second-last in The Economist’s productivity growth ranking, just ahead of Botswana.17

That Australia compares poorly with most other developed economies is confirmed in a recent Productivity Commission paper. The paper draws on ABS data which also shows:

• -0.8% multifactor productivity for the market sector (12 industries) from 2011-12 to 2012-13;

• +0.7% multifactor productivity annually on average over the last 30 years;

• +2.2% labour productivity (GDP per hour worked) from 2011-12 to 2012-13;19

• strong labour productivity over the last 12 months in financial and insurance services; electricity, gas, water and waste services; and mining.

The nature and extent of the link between productivity and workplace relations regulation will no doubt be a major focus of the imminent Productivity Commission review of the FW Act.


“If you talk to a CEO today and ask them what are the top two issues for their business they will invariably say ‘costs and productivity’. ... [I]f we want Australia to remain a high-wage, high-standard of living country, we need to find ways to lift productivity. Cutting costs will only get us so far. That is why this focus on workplace relations is important and essential. An agile and properly functioning workplace relations system goes to the heart of the cost and productivity issues. We have now reached something of a turning point in the increasingly important workplace relations debate in Australia. Discussion of workplace relations reform in past years has been akin to ‘don’t mention the war’. Some politicians would quickly and sometimes nervously change the subject whenever workplace reform was raised. That is now changing.”

Innes Willox, Australian Industry Group Chief Executive, Speech to the Brisbane Club Workplace Relations Special Interest Group, 19 February 2014

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Industrial Action and Union MembershipABS data showed a continued reduction in the incidence of industrial disputes in the 12 months ending March 2014 (204 disputes causing 88,600 working days lost), as shown in the following graph:

Working days lost, Australia

120

100

80

60

40

20

0

000.

Mar 2008 Mar 2009 Mar 2010 Mar 2011 Mar 2012 Mar 2013 Mar 2014

Source: ABS, Industrial Disputes, Australia, March 2014, Cat No 6321.0.55.001.

This reflects a longer-term fall in strikes and other forms of industrial action, with most disputes now linked to enterprise bargaining cycles, and is consistent with the pattern in relation to union membership levels. Overall union membership and union density fell considerably in the 12 months to August 2013:20

UNION DENSITY PRIVATE SECTOR PUBLIC SECTOR OVERALL

2012 13% 43.4% 18.2%

2013 12% 41.7% 17%

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Developments in the Public SectorThe Coalition’s election win has led to a major reshaping of the federal public sector, first through the Commission of Audit process and then the 2014-15 Budget. The National Commission of Audit Report,21 released on 1 May 2014, recommended a range of measures to reduce government expenditure by $60-70 billion per year over the next ten years and return the federal budget to surplus. The recommendations included:

• the rationalisation of over 900 Commonwealth bodies and far tighter controls on federal grant programs;

• major reductions in health, education and family support programs;

• selling off government assets including Snowy-Hydro, Medibank and Australia Post;

• reducing the size of the federal public sector workforce by 5% (around 15,000 employees);

• specifically in relation to workplace relations:

– replacing the minimum wage-setting function of the FWC with an administrative wage adjustment process (possibly based in the Department of Employment), under which variations in the minimum wage in different regional areas would be permitted;22

– amalgamating the Fair Work Ombudsman with the Commonwealth Ombudsman’s office, and consolidating numerous federal bodies (eg Comcare, Safe Work Australia, Workplace Gender Equality Agency) into the Department of Employment.

While some of the more politically risky Commission of Audit recommendations have not been taken up by the Government, its first Budget delivered on 13 May confirmed significant reductions across all areas of government spending – and the cut-back of 16,500 full-time public service jobs over the next three years.


“Australia’s future economic strength... will come through policy and reform that makes it easier for business to invest with certainty. Therefore we must re-evaluate how our workplace relations framework influences access to labour and how it affects the viability of new projects... High labour costs and low productivity are an unsustainable mix.”

The Hon Martin Ferguson AM, Chairman of the Australian Petroleum Production and Exploration Association Advisory Board, CEDA Speech, Perth, 28 February 2014

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Federal Budget: ACTU Response

The Australian Council of Trade Unions Executive recently adopted a “bargaining toolkit” aimed at assisting unions to address Government Budget measures through enterprise bargaining claims, for example:23

• sick leave: employers to reimburse employees the amount of any Medicare co-payment for visits to a GP (currently proposed to be $7.00 per visit)

• vehicle allowance: an additional $0.78 per kilometre to reflect increased costs arising from the freeze on fuel excise indexation

• working parents allowance: $13.75 per week to cover the freezing of child care rebate at $7500 per annum (instead of current indexation to CPI)

• superannuation: agreements from July 2015 should reflect superannuation increases proposed by former Labor Government, rather than Abbott Government freeze of superannuation increases at 9.5% until June 2018

The National Commission of Audit and Budget initiatives continue the trend towards “contestability” and the drive for efficiency in the federal and state public sectors. The Newman Government in Queensland has been at the forefront of this approach, through which governments seek to test the market to ensure that the public is being provided with the best services for maximum value.24

Contestability: 25

• goes beyond the privatisation and outsourcing initiatives of the last 20 years, which have not sufficiently enhanced public sector productivity

• “introduces the credible threat of competition to better influence cost, quality and productivity”

• includes choice-based models where service users select from a range of providers with full or partial funding from government vouchers – used in the delivery of health and education services, and in the National Disability Insurance Scheme

• also includes public-private partnerships, public-private joint ventures and integration contracts – used in defence support and corrections

• “By focusing on the public sector’s core activities – regulation, policy and service delivery – contestability involves rethinking the role of government and shifting the public sector mindset from ‘need to deliver’ to ‘responsible for outcome’.”

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What Future for Australian Manufacturing and Qantas?The last 12 months have presented significant challenges for the manufacturing sector, with large-scale job losses and the decisions by auto giants Holden and Toyota to close their Australian operations by 2017. The role of government in supporting manufacturing industry was the big issue of the new year, as Toyota and food manufacturer SPC Ardmona sought additional subsidies to guarantee their future operations.

The Abbott Government has refused the companies’ requests, pointing to their need instead to address cost pressures arising from union-negotiated enterprise agreements.26 Toyota had, in fact, sought to renegotiate its agreement with the Australian Manufacturing Workers Union – a move successfully challenged by the union in the Federal Court27 (although this decision was recently overturned by a Full Court).28

On the other hand, SPC Ardmona refuted the assertion that “generous” allowances and other conditions were at the core of its problems,29 and negotiated a subsidy from the Victorian Government to keep its Shepparton production plant operating.

Snapshot of the manufacturing sector: 30

• contracted for the 7th consecutive month in the AiGroup Performance of Manufacturing Index for May 2014

• challenging business conditions including dampened confidence from the federal Budget; delayed/lowered business commitment to new expenditure; and intensified export competition from stronger Australian dollar

• expansion in four sub-sectors in May: petroleum, coal, chemicals and rubber products; non-metallic minerals; wood and paper products; textiles, clothing and other goods

• contraction in other sub-sectors: food and beverages; metal products; machinery and equipment

Adopting the same tough line on industry assistance, the federal Government resisted pressure from Qantas for a debt guarantee to enable the airline to compete on a “level playing field” with Virgin.31 Instead, the Government introduced the Qantas Sale Amendment Bill 2014 into Parliament, which proposed to:

• allow increased foreign ownership of Qantas; and

• remove the requirement that Qantas keep the majority of its jobs in Australia, allowing more scope for “offshoring” of maintenance and other functions.32


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Continuing the strategy it pursued in the 2011 industrial dispute, Qantas maintained that its future viability depends heavily on its ability to reduce labour costs – primarily through redundancies, outsourcing and offshoring – in the face of strong resistance from unions in the aviation sector.

In February, the airline announced drastic measures to achieve $2 billion in cost reductions over the next three years, including:

• making 5000 positions redundant across the business;33 and

• an immediate wages “freeze”, applicable to all enterprise agreements under negotiation and (subject to negotiations with relevant unions) existing agreements.34

Prime Minister Abbott on Industry Assistance:

“[W]e don’t want to see corporate welfare ... we don’t believe in corporate welfare. This government will be very loth to consider requests for subsidies, we will be very loth to do for businesses in trouble the sort of things they should be doing for themselves.”

Quoted in Lenore Taylor, “Tony Abbott declares an end to ‘corporate welfare’”, The Guardian, 18 December 2013

“... governments don’t create jobs, businesses do ... [and] only profitable businesses create jobs.”

Quoted in Phillip Coorey, “Toyota blamed union”, The Australian Financial Review, 12 February 2014

“As Shadow Minister it was always disappointing to see weak-kneed employers caving into unreasonable union demands then coming to me advocating for workplace relations reform, effectively blaming the system for their own shortcomings. In some cases, their history of cave-ins was longstanding, even during times when the system was arguably more in their favour. As Minister, this phenomenon is now even more frustrating. I have often wondered why they couldn’t just say ‘no’ from the outset?”

Senator Eric Abetz, Employment Minister, Industrial Relations after the Thirty Years War, Address to the Sydney Institute, 28 January 2014

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MAJOR WORKPLACE RELATIONS DEVELOPMENTS

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The Abbott Government’s Legislative and Policy AgendaSince the election, the Government has introduced several pieces of legislation and taken a number of other steps to implement the commitments set out in its 2013 workplace relations policy.35

The policy outlined the Coalition’s plans to make minimal changes to the FW Act, and to have the Productivity Commission undertake an extensive review of the legislation in the Coalition’s first term of government.36 Separate policy documents set out the Coalition’s proposed reforms in relation to registered organisations,37 and its more generous paid parental leave (PPL) scheme.38

Registered Organisations Bill and Trade Unions Royal Commission

One of the first bills introduced into Parliament, reflecting the Coalition Government’s strong first-term focus on reining in trade unions, the Fair Work (Registered Organisations) Amendment Bill 2013 is largely a response to the Health Services Union (HSU) corruption scandal of recent years.39 The Bill includes the following proposals:

• Establishment of a Registered Organisations Commission (ROC), replacing the FWC General Manager as the regulator of registered trade unions and employer organisations. The proposed ROC would have greater investigation and information-gathering powers, modelled on the Australian Securities and Investments Commission.

• More onerous financial disclosure and reporting obligations for office-holders of registered organisations, similar to the rules applicable to company directors under the Corporations Act 2001 (Cth). Criminal liability would apply to serious breaches of these new rules, with maximum penalties of $340,000/5 years’ imprisonment.

While these changes are mainly directed at (and opposed by) trade unions, in submissions to a Senate Committee inquiry into the Bill, employer organisations such as Australian Industry Group expressed concerns about the increased regulatory burden they will face under the proposed new disclosure regime.40 Whether this results in amendments to address these concerns (as recommended by Coalition Senators)41 remains to be seen.

Soon after media reports of alleged corruption and “kick-backs” involving unions in the construction industry, the Government announced the establishment of the Trade Unions Royal Commission.42 The Terms of Reference for the Royal Commission43 require former High Court Judge, The Hon John Dyson Heydon QC AC, to inquire into and report upon matters including:

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• the payment of bribes, secret commissions or other unlawful payments or benefits arising from contracts between unions and other parties; and

• unions’ establishment of separate entities (purportedly for industrial purposes or to benefit union members), the corporate governance and financial management of such entities, and their fund-raising activities.

While five unions are specifically named in the terms of reference (HSU; Australian Workers Union; Transport Workers Union; Construction, Forestry, Mining and Energy Union (CFMEU); Communications, Electrical and Plumbing Union (CEPU)), the Royal Commission may inquire into the activities of any union. Employers, particularly in the construction industry, are also being drawn into the Royal Commission’s inquiries.44

An indication of the likely focus of the Royal Commission’s recommendations was provided by the release, in mid-June 2014, of three Issues Papers exploring whether:

• existing laws offer adequate protection for “whistleblowers” to come forward with disclosures of union corruption or unlawful conduct;45

• improvements could be made to the regulatory model for governance and financial management of unions (and other entities or funds which unions operate), including the duties of trade union officials;46

• current regulation of the funding of trade union elections ensures transparency in the deployment of union funds.47

A fourth issues paper released in July focuses on whether there is presently sufficient regulation of “relevant entities” (more commonly known as union “slush funds”).48

Construction Industry Bill and new Construction Code

Closely linked to the Government’s proposed reforms of trade union regulation, the Building and Construction Industry (Improving Productivity) Bill 2013 seeks to restore the rule of law and a tougher compliance regime in this highly adversarial sector.49 In particular, the Bill proposes to:

• Re-establish the ABCC with its full powers, including the ability to compel attendance and require the production of documents by persons with information relevant to an investigation, backed up by criminal offences. The current constraint on the regulator’s capacity to bring enforcement proceedings where the parties have settled the issues in dispute, will be removed.

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• Expand the scope of application of the construction industry legislation, and the remit of the regulator, to include the transport or supply of goods to building sites and offshore resources platforms.

• Introduce new limits on unlawful industrial action in the building industry (eg protected action only to be taken by those directly involved in bargaining for an enterprise agreement), and a new prohibition of unlawful picketing (largely in response to disruptive CFMEU pickets, such as on the Grocon Myer Emporium site in 2012 which resulted in the Supreme Court of Victoria imposing contempt fines of $1.25 million on the union).50

• Increase the penalties for unlawful industrial action/picketing to a maximum of $34,000 for individuals/$170,000 for bodies corporate; and make injunctions to restrain threatened unlawful industrial action/pickets more easily available.

With the Bill still before Parliament early in the new year, employers in the construction industry expressed strong concerns about overly-generous employment conditions, such as the taking of RDOs in conjunction with other leave to create a 10-day industry shutdown over Easter.51

In mid-March, the Productivity Commission endorsed the return of the ABCC; and recommended that the Government change the Building Code 2013 to reflect the Victorian Government’s Construction Code and Implementation Guidelines (for example, to prevent “sweetheart” union deals that preclude competition from sub-contractors with lower wage costs).52

On 17 April 2014, Employment Minister Senator Eric Abetz issued an advance release of the Government’s proposed new Building and Construction Industry (Fair and Lawful Building Sites) Code.53 The proposed Code represents a return to a stricter framework for construction industry procurement than that which applied under the former Labor Government. Key provisions of the proposed Code, which must be met by organisations tendering for Commonwealth-funded building work (and on their privately-funded work), include:

• a wide range of prohibitions on certain clauses in enterprise agreements, eg clauses which restrict the engagement of sub-contractors, restrict employment flexibility, or provide various forms of support to unions in the workplace (these prohibitions will apply with effect from 24 April 2014, ie agreements entered into from that date which include any prohibited clauses will place a tenderer in breach of the Code);

• reporting obligations in relation to the occurrence of unprotected industrial action on building sites;

• obligations to preserve freedom of association and to prevent unlawful union entry onto building sites;

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• obligations to ensure that the Code is observed by any sub-contractors of a principal contractor.

The commencement and operation of the proposed Code is at present uncertain, as this requires both that the enabling legislation (Building and Construction Industry (Improving Productivity) Bill 2013) be passed by Parliament; and that the Code itself (as it is a legislative instrument) not be disallowed by Parliament. However, there is evidence that the draft Code is already having a practical effect:

• with some major employers seeking the removal from proposed enterprise agreements of clauses that may offend the Code’s rules on prohibited content (given their retrospective effect from 24 April 2014);54

• and the industry-wide pattern agreement in NSW being called into question due to its likely incompatibility with the proposed Code.55

The Government has also sought to bring about cultural change in the construction industry through the appointment, in October 2013, of Mr Nigel Hadgkiss as Director of the current regulator (Fair Work Building and Construction). The new Director has implemented a shift in the agency’s strategic direction,56 significantly increasing its investigations into union misconduct57 and prosecutions for unlawful industrial action.58

Fair Work Amendment Bill

The Fair Work Amendment Bill 2014 includes the following proposed amendments to the FW Act:

• Simpler processes for the making of greenfields agreements for genuine new businesses, projects or undertakings. The amendments seek to address employer concerns that unions exercise veto powers over these agreements (particularly on large resources and construction projects), adding to project costs and causing delays. Greenfields agreements would be made subject to the good faith bargaining rules, and employers could seek FWC approval of a proposed agreement if no deal is reached after three months of negotiations. The FWC could consider relevant industry standards in deciding whether to approve a greenfields agreement in these circumstances.

– This aspect of the amendments is opposed by the Australian Mines and Metals Association (AMMA), which is concerned that existing inflated wages and conditions in the resources sector would become the benchmark for future agreements.60

– The Australian Petroleum Production and Exploration Association (APPEA) (whose members in the oil and gas industry use greenfields agreements extensively) also has concerns about the proposed amendments. APPEA has argued for a new


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stream of “major project agreements” to be created under the FW Act, with a minimum term of five years and a process for arbitration of renewal agreements.61

• Providing employers with easier access to individual flexibility arrangements (IFAs) which can be used to vary award or agreement conditions relating to hours of work, overtime, penalty rates, allowances and leave loading. IFAs would be terminable unilaterally after 13 weeks (rather than 5 weeks at present), and non-monetary benefits could be considered in assessing the fairness of an IFA.

• New restrictions on union rights of entry onto employers’ premises, including a requirement that entry for purposes of holding meetings with members or prospective members would be dependent on a union being covered by an enterprise agreement applicable to work performed at the workplace; or the union being invited into the workplace by a member or prospective member. Recent FW Act amendments requiring employers to facilitate union access to remote worksites, and designating lunchrooms as the default location for workplace union meetings, would be repealed.

• Preventing unions from taking protected industrial action in support of claims for a new enterprise agreement before bargaining has actually commenced.

• Amendments to clarify certain National Employment Standards (NES) entitlements, simplify the process for FWC dismissal of unmeritorious unfair dismissal claims, and facilitate easier transfers of business between associated entities.

These changes were outlined in the Coalition’s 2013 election policy; some were also recommended by the 2012 Fair Work Act Review Panel.62

Paid Parental Leave

The Prime Minister has agreed to scale back his flagship PPL scheme (reducing the maximum level of PPL payments from $75,000 to $50,000),63 however, its future remains uncertain particularly due to likely opposition in the Senate.64 The main aspects of the proposed PPL scheme, compared with the current scheme introduced by the former Labor Government, are as follows:

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PROPOSED PPL SCHEME CURRENT PPL SCHEME

Primary entitlement

26 weeks’ paid leave for the primary carer at their actual wage or the national minimum wage (whichever is greater), with payments capped at $50,000.

18 weeks’ paid leave at the national minimum wage.

Eligibility All workers (including casual, seasonal, contract and self-employed workers) who have worked for at least 10 out of the 13 months prior to the birth or adoption of a child, and at least 330 hours in that 10 month period (just over one day a week), with not more than an eight week gap in work.

The same eligibility criteria apply, except those who earn over $150,000 are excluded from the scheme.

Secondary entitlement

Two weeks’ paid leave for secondary carers at their actual wage or the national minimum wage (whichever is greater), with payments capped in line with the primary carer’s salary and the leave deducted from the primary carer’s leave.

Two weeks’ paid leave at the national minimum wage, in addition to the primary carer’s leave.

Administration Payments made and administered via the Department of Human Services (DHS), not employers.

Payments under the current scheme made via employers following a determination of employee’s eligibility by DHS.

Superannuation Superannuation contributions at the mandatory rate to be made on PPL payments to primary and secondary carers.

No provision for superannuation contributions for carers on PPL.

Other significant features of the new PPL scheme remain unclear, including its relationship with existing employer schemes; how the income test will be applied, and income calculated, for certain types of workers (eg self-employed, contractors); and how the 1.5% levy on larger businesses (intended to partly fund the scheme) will operate.65


26


Although the new PPL scheme is scheduled to commence on 1 July 2015, no legislation bringing it into effect has yet been introduced into Parliament.

FWC Appeals Jurisdiction

The Coalition’s 2013 election policy included a vague commitment to “[give] active consideration to the creation of an independent appeal jurisdiction” for the FWC.66 The Government has since cited inconsistent decisions of single Commission members (in matters such as agreement approval and unfair dismissal) as the main rationale for the new appeal mechanism.67 The proposal is strongly supported by AMMA, which wants the new body to deal with major FWC test cases as well as appeals.66

Details of the proposal – including the nature of the appeals body, and whether it would sit within or outside the FWC – have not been provided by the Government. Despite this, Minister Abetz initiated a consultation process with stakeholders late last year, and told a Senate Estimates hearing in early June 2014 that he was still considering the more than 30 submissions received.69 In that forum, and in a speech he made in late May, FWC President Justice Iain Ross refuted the argument that a new appeals body was needed due to inconsistency in FWC decision-making.70

Public Sector Bargaining

On 28 March 2014, the Government issued new bargaining guidelines for the Australian Public Service (APS), intended to “reverse [the Labor Government’s] union-driven move towards APS-wide bargaining”.71 As well as effecting a return to agency-level agreement-making, the new framework requires federal departments and agencies to ensure productivity improvements, freedom of association and minimal limits on managerial prerogative under enterprise agreements.72

Revocation of Fair Work Principles

The former Labor Government’s “Fair Work Principles”, which applied to federal procurement contracts above $80,000 and required tenderers to show compliance with the FW Act and related laws, were revoked in March 2014 as part of the Abbott Government’s “red tape” Repeal Day.73 From 1 July 2014, while tenderers for government contracts no longer have to make declarations of compliance in the tendering process, they must of course continue to comply with the FW Act and any applicable modern awards or enterprise agreements.

27

Gender Equity Changes

The Government has delayed, by 12 months, the additional gender equity reporting obligations for organisations with 100 or more employees which were scheduled to come into effect on 1 April 2014 under the Workplace Gender Equality Act 2012 (Cth). Accompanying this change, a minimum standard was introduced for the reporting requirements applicable to organisations with 500 or more employees for the 2014-15 reporting year. These organisations will need to have in place, by 1 October 2014, a policy or strategy relating to workforce gender composition; equal remuneration; flexible working arrangements; or sexual harassment or discrimination.74

Government-initiated Reviews

In addition to the legislative and policy changes outlined above, the Abbott Government has commenced reviews in several other areas of employment regulation including:

• The Road Safety Remuneration Tribunal (RSRT), established under the Road Safety Remuneration Act 2012 (Cth) to set minimum rates for employees and owner drivers in the road transport sector. The Government has received, but not yet publicly released or acted upon, the review report.75 It is widely expected that the Government will abolish the RSRT.76

• A broader Australian Law Reform Commission “Review of Commonwealth Laws for Consistency with Traditional Rights, Freedoms and Privileges”(instigated by the Attorney-General)77 specifically mentions workplace law as one of its three main areas of focus. This will likely involve consideration of (for example) “reverse onus” provisions, such as those applicable in relation to adverse action claims under Part 3-1 of the FW Act.

• An independent review of the subclass 457 visa program commenced in March and was scheduled for completion in mid-2014.78 The Government has also sought to repeal the Migration Amendment (Offshore Resources Activity) Act 2013 (Cth), which requires non-citizens working on offshore resources platforms to hold valid work visas. 79 A regulation implementing the repeal was blocked by the new Senate in mid-July.80 The Government addressed this by issuing a determination under the Migration Act to effect the repeal81 (although this has now been challenged in the Federal Court).82


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What will the new Senate do with the Government’s workplace reform bills?

The Coalition Government’s prospects of passing legislation have improved since 1 July 2014. Instead of Labor and the Greens being able to combine to block proposed laws, the Government now needs the support of six out of the new Senate’s eight independent and minor party senators to secure the passage of legislation. Although it is very difficult to be confident we anticipate majority support for the government’s amendments to the Fair Work Act and the Building and Construction Bill. The fate of the PPL Scheme is more uncertain.

Assessment of the Government’s Legislative and Policy Agenda:

Overall, the Government is being very careful in its first term of office not to intrude upon the individual rights of workers in a way that could invite a “return to Work Choices” scare campaign by unions and the federal Opposition. The Coalition’s main focus is to clamp down on illegitimate union activity, with several other measures proposed to keep its employer constituency satisfied for the time being. However, pressure for more substantive legislative reforms will build as the next federal election draws nearer.

“[Workplace relations are a] troublesome area [and] there has been a shortage of trust on both sides. [But too often the debate within the mining sector has been] reduced to an argument about whether employee wages are too high. Or the flawed notion that passing a law in Canberra will drive productivity growth and competitiveness in an individual enterprise. Cutting wages is not the answer, not the issue. Ours is a challenge of productivity and competitiveness.”

Opposition Leader, The Hon Bill Shorten MP, Minerals Council Conference, Canberra – quoted in “Rio Tinto boss blasts IR system”. AFR, 28 May 2014

29

DATE, JURISDICTION 17 July 2013, FWC

CASE United Voice v MSS Security Pty Ltd [2013] FWC 4557

SUMMARY The FWC refused the union’s application to end the employer’s lockout of employees under FW Act, section 423. Confirming that the bar for terminating protected industrial action due to serious harm to any of the bargaining parties is high, the FWC found that the test was not satisfied where workers had been locked out for between nine days and one month.

DATE, JURISDICTION 14 August 2013, High Court of Australia

CASE CFMEU v Mammoet Australia Pty Ltd [2013] HCA 36

SUMMARY The provision of on-site accommodation to employees during a period of protected industrial action was not a “payment” that was prohibited by FW Act, Part 3-3, Division 9.83

DATE, JURISDICTION 26 August 2013, FWC Full Bench

CASE NTEU v Monash University [2013] FWCFB 5982

SUMMARY The Full Bench overturned a single member’s decision that the union’s ban on issuing exam results did not provide grounds for suspending protected industrial action under FW Act, section 424. The Full Bench found that the action endangered student welfare to such an extent that the ground for suspension in section 424(1)(c) was satisfied. A two-week suspension of the exam results ban was imposed.

Key Workplace Relations Decisions 2013-14


INDUSTRIAL ACTION

30


DATE, JURISDICTION 30 September 2013, FWC Full Bench

CASE ASU v Yarra Valley Water Corporation [2013] FWCFB 7453

SUMMARY The employer had misled employees about certain provisions of a proposed enterprise agreement, prior to a second ballot in which the employees voted in favour of the agreement. However, the Full Bench held that the misrepresentations had not affected the employees’ “genuine agreement” to the proposed deal, as required by FW Act, sections 187-188.

DATE, JURISDICTION 27 March 2014, Federal Court

CASE John Holland Pty Ltd v CFMEU and FWC [2014] FCA 286

SUMMARY An employer may make an enterprise agreement with a limited number of employees, but with the capacity for the agreement to apply to a larger number of employees over time. These arrangements are commonly used in the resources and construction industries.89

DATE, JURISDICTION 31 January 2014, FWC Full Bench

CASE MUA v Patrick Stevedores Holdings Pty Ltd [2014] FWCFB 657

SUMMARY The union’s breach of commitments not to impose productivity caps (reflected in the negotiation of an enterprise agreement) constituted unprotected industrial action, providing the basis for section 418 “stop orders” to be issued.

DATE, JURISDICTION 19 February 2014, Full Federal Court (majority decision)

CASE Energy Australia Yallourn Pty Ltd v CFMEU [2014] FCAFC 8

SUMMARY The FWC may extend the 30-day time period for taking protected industrial action (under FW Act, section 459(1)(d)), even in circumstances where an application for extension is made after the 30 days have expired.

AGREEMENT MAKING

31

DATE, JURISDICTION 2 April 2014, FWC Full Bench

CASE Peabody Moorvale Pty Ltd v CFMEU [2014] FWCFB 2042

SUMMARY Employers must not provide any additional material with a notice of representational rights issued to employees at the commencement of agreement negotiations. This is likely to breach the strict requirements of FW Act, section 174(1A), invalidating the entire bargaining process and leading to non-approval of the agreement.90

DATE, JURISDICTION 2 May 2014, Federal Court

CASE Kaizen Hospitals (Essendon) Pty Ltd v ANF [2014] FCA 428

SUMMARY Proposed enterprise agreements must be entered into by a representative of the employer with authority to conclude an agreement, before they can be validly voted on by employees and approved by the FWC. Failure to comply could undermine the entire bargaining process.92

DATE, JURISDICTION 29 May 2014, FWC Full Bench

CASE Canavan Building Pty Ltd [2014] FWCFB 3202

SUMMARY The FWC will not approve an enterprise agreement with a clause providing for “all in” rate of pay covering annual leave entitlements. Under the NES, payment for annual leave must be made at time leave is taken.94


32


DATE, JURISDICTION 12 December 2013, Federal Court

CASE Marmara v Toyota Motor Corporation Australia Limited [2013] FCA 1351

SUMMARY In seeking to vary its enterprise agreement under FW Act, sections 207-216, Toyota breached the agreement’s no extra claims clause. That clause had to be varied before the company could put the substantive agreement changes to a ballot of employees.85 This decision was recently overturned by a Full Court on appeal: Toyota Motor Corporation Australia Limited v Marmara [2014] FCAFC 84.

DATE, JURISDICTION 28 October 2013, Federal Circuit Court

CASE ALAEA v Qantas Airways Limited (No 2) [2013] FCCA 1696

SUMMARY The Court imposed penalties of $41,250 on the airline, for failing to properly inform and consult with the union over the introduction of a new “maintenance on demand” system which led to 30 redundancies.84

CONSULTATION OVER CHANGE

RENEGOTIATION OF AGREEMENT

33

DATE, JURISDICTION 19 December 2013, Full Federal Court

CASE State of Victoria v CFMEU [2013] FCAFC 160

SUMMARY The Full Court overturned earlier decisions of a single judge, to find that the Victorian Government did not breach Part 3-1 of the FW Act through its implementation of the Victorian Construction Code and Implementation Guidelines. The decision legitimised the State Government’s use of procurement policy to pursue industrial relations objectives by requiring tenderers for public building contracts to comply with certain obligations (including not having a range of “union-friendly” clauses in their enterprise agreements).86

DATE, JURISDICTION 31 January 2014, Federal Court

CASE United Firefighters Union of Australia v Country Fire Authority [2014] FCA 17

SUMMARY Clauses in the CFA’s enterprise agreement dealing with recruitment of employees were ruled unconstitutional, as they infringed the limits on Victoria’s capacity to function set out in Re AEU.87 These limitations were found to apply even in relation to provisions voluntarily agreed to by the Victorian Government.88


APPLICATION OF VICTORIAN GOVERNMENT CONSTRUCTION CODE

VALIDITY OF AGREEMENT

34



CASE CFMEU v Gittany [2014] FCA 164

SUMMARY The union’s right to enter a construction site did not extend to entry onto an adjacent car park; and the employer was entitled to prevent union re-entry onto the site until police arrived, where safety was threatened by a dispute over the union’s proposed entry.


CASE CFMEU v Fair Work Commission [2014] FWCFB 2709

SUMMARY The FWC’s power to initiate reviews of abuse of union entry rights (FW Act, section 508) was validly exercised at first instance in respect of CFMEU entry on several Adelaide building sites.


CASE ResMed Ltd v AMWU [2014] FWCFB 2418

SUMMARY A union can obtain a majority support determination where it is eligible to cover only one of the employees to be covered by an agreement. The union does not need to have eligibility to cover all categories of employees who the agreement will cover.91

RIGHT OF ENTRY

BARGAINING

35

DATE, JURISDICTION 14 May 2014, FWC Full Bench (majority decision)

CASE Appeal by Restaurant and Catering Association of Victoria [2014] FWCFB 1996

SUMMARY As part of the FWC’s initial two-year review of modern awards, a Full Bench majority found that although long-standing arguments around the need to reward workers for the disabilities of Sunday work remained valid, some workers were being overcompensated for working on Sundays. This justified a reduction in the Sunday penalty rate for casuals working in restaurants and cafes from 75% to 50%.93


“The main area of concern for Australia is the rigidity of its labour market. There is no way to achieve increased productivity without changes that affect the way we employ and deploy labour.”

Phil Edmands, Rio Tinto Australia Managing Director, Minerals Council Conference, Canberra – quoted in “Rio Tinto boss blasts IR system”, AFR, 28 May 2014

“[O]ne thing that is as true today as it was 25 years ago, is that employers make their own luck. You’ve just got to deal with the legislation that exists at the time, and navigate your way through, and not use the legislation as an excuse as to why you can’t do things.”

Ian Masson, Woodside Energy HR Vice President, Speech to AMMA Australian Resource People Summit, Perth, 29 May 2014

AWARD PENALTY RATES

36


37

MAJOR EMPLOYMENT LAW DEVELOPMENTS

38


FWC Anti-Bullying JurisdictionThe commencement on 1 January 2014 of the FWC’s new anti-bullying jurisdiction95 was much anticipated, with the Commission indicating (in the lead-up) that it was expecting almost 900 claims per quarter. In the event, to the end of March 2014, only 151 claims were lodged under Part 6-4B of the FW Act which enables workers to seek orders from the FWC to stop workplace bullying.

Part 6-4B, FW Act – Key Provisions

Under section 789FD(1) of the FW Act, a worker is bullied at work when:

• another individual or group of individuals “repeatedly behaves unreasonably towards the worker”; and

• “that behaviour creates a risk to health and safety.”

Section 789FD(2) states that the definition of bullying does not include “reasonable management action carried out in a reasonable manner.”

The FWC may issue an order to stop bullying under section 789FF(1) where it is satisfied that a worker has been bullied, and there is a risk that the bullying will continue.

Only one anti-bullying order was issued in the first six months of the operation of Part 6-4B. This and all of the jurisdictional and substantive decisions are summarised below.96

FWC Anti-Bullying Jurisdiction: Decisions/Orders, 1 January-30 June 2014

DATE 6 and 25 March 2014

CASE Application by McInnes [2014] FWCFB 144 and [2014] FWC 1395

SUMMARY Alleged bullying conduct which occurred prior to Part 6-4B coming into effect (ie prior to 1 January 2014) can be taken into account by the FWC when considering an application for an anti-bullying order. However, the applicant’s claim was dismissed, as she did not work in a “constitutionally-covered business” (she worked for a not-for-profit provider of psychiatric support services) and the FWC therefore did not have jurisdiction in the matter.

39


DATE 21 March 2014

CASE Applicant v Respondent (FWC Order, PR548852)

SUMMARY The FWC issued an order by consent, following a conference between the parties, requiring the applicant’s co-worker to (among other things):

• have no contact with the applicant alone;

• make no comment about the applicant’s clothes or appearance;

• not send any emails or texts to the applicant (other than in an emergency).

DATE 2 April 2014

CASE Balthazar v McGuire; Department of Human Services (Commonwealth) [2014] FWC 2076

SUMMARY The applicant (a recipient of carer’s payments from a government department who alleged bullying in his treatment by department staff) was not a worker covered by Part 6-4B, therefore his claim was dismissed.

DATE 12 May 2014

CASE Application by Ms SB [2014] FWC 2104

SUMMARY An employer’s investigation into alleged bullying by a manager did not, itself, constitute bullying against the manager as the employer had a duty to investigate such complaints. Reasonable management action does not constitute bullying, and for these purposes, management action need not be perfect or ideal. Applying this broad approach to what constitutes reasonable management action, the applicant’s claim was rejected.

40


DATE 28 May 2014

CASE Shaw v ANZ Banking Group Limited; Haines [2014] FWC 3408

SUMMARY The claim could not be pursued where the applicant was dismissed from his employment subsequent to lodging an application for anti-bullying orders. Orders under Part 6-4B are directed at preventing further bullying from taking place; the FWC could not make such orders where the applicant was no longer employed in the relevant workplace.

DATE 6 June 2014

CASE Application by Ms SW [2014] FWC 3288

SUMMARY The claim was dismissed because the applicant (a teacher in a Western Australian state school, employed by the WA Department of Education) did not work in a “constitutionally-covered business”. Part 6-4B does not apply to employees of state public sector employers.

DATE 16 June 2014

CASE Mr Tao Sun [2014] FWC 3839

SUMMARY The applicant’s claim was dismissed. It was based on alleged bullying by his manager in the form of (i) denial of a performance bonus; and (ii) allocation of a particular work project. The FWC found that non-payment of a discretionary bonus (unless punitive) would not generally constitute bullying; and the allocation of work in accordance with an employee’s position description was not unreasonable.

41

DATE 17 June 2014

CASE The Applicant v General Manager and Company C [2014] FWC 3940

SUMMARY Alleged bullying conduct by a supervisor – including becoming angry in a meeting with the applicant, having direct contact with members of the applicant’s team, and directing her to leave when she returned to work from stress leave – was considered to be reasonable in all the circumstances. One allegation of bullying was made out, ie the supervisor’s failure to allow the applicant to have a support person present at meetings. However, no anti-bullying order was issued in the absence of “repeated incidents of unreasonable behaviour which were not reasonable management action carried out in a reasonable manner.”

DATE 24 June 2014

CASE Applicant v Respondents [2014] FWC 4198

SUMMARY The respondents were granted the right to legal representation in jurisdictional proceedings arising from the applicant’s claim for anti-bullying orders (even though the applicant was unrepresented).

Unfair Dismissal and General Protections ClaimsThe volume of unfair dismissal and general protections claims remained high over the last 12 months, with unfair dismissals topping the 4000 mark for the first time in the September quarter. Employers will focus on the burden of responding to both categories of claims as the IR reform debate intensifies.

Claims Lodged with FWC: July 2013-March 2014

UNFAIR DISMISSAL GENERAL PROTECTIONS

September Quarter 4048 879

December Quarter 3768 900

March Quarter 3510 880

Source: FWC Quarterly Reports, available at: https://www.fwc.gov.au/about-us/reports-publications/quarterly-reports.


https://www.fwc.gov.au/about-us/reports-publications/quarterly-reports

https://www.fwc.gov.au/about-us/reports-publications/quarterly-reports

42


Key Employment Law Decisions 2013-14

DATE, JURISDICTION 6 August 2013, Full Federal Court (majority decision)

CASE Commonwealth Bank of Australia v Barker [2013] FCAFC 83

SUMMARY The majority held that, in the absence of express terms to the contrary, there is an implied term of mutual trust and confidence in every Australian employment contract. This term requires that an employer will not, without reasonable cause, conduct itself in a manner likely to seriously damage the relationship of trust and confidence between employer and employee. The Bank had breached this term when it made Mr Barker redundant in breach of its contractual obligation to consider redeployment, resulting in an award of $335,623 in damages.97

DATE, JURISDICTION 10 December 2013, Federal Court

CASE Bayley and Associates Pty Ltd v DBR Australia Pty Ltd [2013] FCA 1341

SUMMARY A former executive breached express obligations under his employment agreement and the implied duty of fidelity when, subsequent to resigning, he had:

• set up a business in competition with his former employer;

• held negotiations with one of his former employer’s clients; and

• transferred confidential business information belonging to his former employer, including client lists and training materials.

CONTRACT OF EMPLOYMENT/ IMPLIED TERM OF TRUST AND CONFIDENCE

BREACH OF AGREEMENT/FIDUCIARY DUTIES

43

DATE, JURISDICTION 22 October 2013, Federal Court

CASE MKP v Arkell [2013] FCA 1066

SUMMARY A former employee’s defence in breach of contract proceedings was partly struck out, where it was shown that he had deleted emails relevant to the proceedings. The employer contended that the emails would show that the former employee had approached its clients in breach of a confidentiality deed and restraint clause.


DATE, JURISDICTION 25 March 2014, NSW Supreme Court

CASE Andrews Advertising Pty Ltd v Andrews [2014] NSWSC 318

SUMMARY A six-month post-employment restraint clause was upheld as reasonable, with the result that an executive was required to pay $557,711 in damages to his former employer for breaching his contractual and fiduciary duties.

DATE, JURISDICTION 29 May 2014, NSW Supreme Court

CASE Network Ten Pty Ltd v Seven Network (Operations) Ltd [2014] NSWSC 692

SUMMARY The Court refused to grant an injunction restraining a recently-signed executive of the Ten Network from returning to his position with the rival Seven Network. It was found that the restrictions under the executive’s contract with Ten did not operate as he had not formally commenced employment with the network. The Court applied long-standing principles against imposing an order for specific performance of an employment contract upon an employee.

CONTRACT OF EMPLOYMENT/ CONFIDENTIAL INFORMATION

RESTRAINT OF TRADE/FIDUCIARY DUTIES

RESTRAINT OF TRADE

44


DATE, JURISDICTION 13 December 2013, Full Federal Court

CASE Linfox Australia Pty Ltd v FWC [2013] FCAFC

SUMMARY The Full Court upheld a Full Bench of FWC decision that an employee had been unfairly dismissed, despite posting highly offensive comments about his managers on Facebook. The FWC did not make a jurisdictional error in finding that the employee should be reinstated, having taken into account his age and his good employment record over 22 years of service.

DATE, JURISDICTION 9 August 2013, Federal Circuit Court

CASE Banerji v Bowles [2013] FCCA 1052

SUMMARY The Court refused an application for orders to prevent the dismissal of a public servant who had anonymously made critical comments on Twitter about the Government and its immigration policies. The Court ruled that there is no unfettered freedom of political expression entitling federal public sector employees to make comments of this nature.98 In an apparent response to the situation in this case, the Department of Prime Minister and Cabinet introduced a very restrictive social media policy, prohibiting employees from (among other things) engaging in harsh or extreme criticism of the Government or its policies; and requiring employees to report social media breaches by their colleagues to the Department.99

SOCIAL MEDIA/GENERAL PROTECTIONS

SOCIAL MEDIA/UNFAIR DISMISSAL

45


DATE, JURISDICTION 25 October 2013, Federal Court

CASE CFMEU v BHP Coal Pty Ltd [2013] FCA 1097

SUMMARY The employer had not breached FW Act, Part 3-1 when it dismissed a union delegate at its coal mine. The dismissal was not for the prohibited reason of the delegate’s activity in coordinating an overtime list under the workplace agreement. Rather, he was dismissed for serious misconduct after abusing a co-worker and purporting to exercise authority to enforce company rules.100

DATE, JURISDICTION 13 December 2013, Full Federal Court (majority decision)

CASE BHP Coal Pty Ltd v CFMEU [2013] FCAFC 132

SUMMARY The dismissal of an employee during an industrial dispute, for holding a sign reading “No Principles SCABS No Guts”, did not constitute unlawful adverse action under Part 3-1 of the FW Act. Although that conduct formed part of industrial activity on the part of the dismissed employee, other aspects of the conduct and its aftermath provided legitimate grounds for dismissal.101


CASE Shea v TRUenergy Services Pty Ltd (No 6) [2014] FCA 271

SUMMARY An employee made redundant following her complaints about the handling of sexual harassment allegations was not dismissed for prohibited reasons under FW Act, Part 3-1. Rather, the dismissal was part of a restructure based on sound business reasons, and some of the employee’s complaints against management were not made in good faith.

GENERAL PROTECTIONS/INDUSTRIAL ACTIVITY

GENERAL PROTECTIONS/COMPLAINT RE EMPLOYMENT

46


DATE, JURISDICTION 2 April 2014, Federal Court

CASE AIPA v Qantas Airways Ltd [2014] FCA 32

SUMMARY Qantas had an implied contractual right to seek detailed medical information from a pilot who had been on personal/sick leave for an extended period. The airline did not take adverse action against the pilot, in breach of Part 3-1 of the FW Act, when it threatened to discipline him for failing to provide a medical report on his prognosis and ability to return to full duties.103

DATE, JURISDICTION 9 May 2014, Federal Court

CASE Walsh v Greater Metropolitan Cemeteries Trust (No 2) [2014] FCA 456

SUMMARY An employee who made complaints about probity issues in the awarding of third party contracts had exercised a “workplace right” under FW Act, Part 3-1 – ie she had made a complaint in relation to her employment. However, this was not the reason for the employer’s decision to dismiss her, which was based on legitimate performance grounds.

DATE, JURISDICTION 14 February 2014, FWC

CASE Smallwood v Ergo Asia Pty Ltd [2014] FWC 964

SUMMARY An employee could not bring an unfair dismissal claim against the organisation she claimed employed her, because it was not registered to sponsor her as a sub-class 457 visa holder under the Migration Act 1958 (Cth).

GENERAL PROTECTIONS/MANAGING LONG-TERM SICK LEAVE

GENERAL PROTECTIONS/ COMPLAINT RE EMPLOYMENT

EMPLOYMENT IN AUSTRALIA/ UNFAIR DISMISSAL

47


DATE, JURISDICTION 19 February 2014, FWC Full Bench

CASE Victorian Association for the Teaching of English Inc v de Laps [2014] FWCFB 613

SUMMARY The entitlement of employees (under FW Act, section 387(d)) to have a support person present in meetings or discussions that could lead to dismissal, does not extend so far as to allow the support person to act as an advocate. An employer’s failure to allow the support person to speak on the employee’s behalf will not result in a finding of unfair dismissal based on lack of procedural fairness.

DATE, JURISDICTION 27 March 2014, Full Federal Court

CASE United Voice v Valspar (WPC) Pty Ltd [2014] FCAFC 34

SUMMARY The Full Court overturned a Federal Circuit Court finding that the employer had not breached the applicable enterprise agreement, and the FW Act, when it directed employees to take some of their accrued annual leave entitlements.

DATE, JURISDICTION 17 December 2013, FWC Full Bench

CASE FP Group Pty Ltd v Tooheys Pty Ltd [2013] FWCFB 9605

SUMMARY FP Group was the true employer of workers it supplied to Tooheys under a labour hire arrangement. A number of dismissed employees could therefore pursue unfair dismissal claims against FP Group. The Full Bench held that the concept of joint employment (which would enable claims to be brought against FP Group and/or Tooheys) has not been accepted in Australian law.102

UNFAIR DISMISSAL

LABOUR HIRE/JOINT EMPLOYMENT

ANNUAL LEAVE ENTITLEMENTS

48


49

LOOKING AHEAD: WHAT ISSUES WILL DOMINATE THE

WORKPLACE RELATIONS LANDSCAPE IN 2014-2015?

50


Economic Outlook

RBA BOARD 105 FEDERAL BUDGET 106 FWC ANNUAL WAGE REVIEW 107

Pace of growth likely to be a little below trend into next year before gradually increasing.

Real GDP forecast to continue growing below trend at 2.5% in 2014-15 before accelerating to near-trend growth (3%) in 2015-16.

The economic outlook for Australia is “sound, with GDP growth expected to ease in 2014-15 before increasing to just below trend in 2015-16.”

Wage pressures are likely to remain constrained over the year ahead.

Consumer price inflation expected to remain well contained with moderate wage pressures.

Inflation is anticipated to slow, reaching the mid-point of RBA’s target band. Wages forecast to increase only modestly.

Relatively moderate employment growth over coming months.

Unemployment rate expected to rise further to 6.25% by mid-2015.

Employment growth expected to be stronger in 2014-15 than last two years, although unemployment will peak at 6.25%.

Firms’ investment intentions indicated mining investment would fall sharply over 2014-15, but modest increase in non-mining investment.

Resources investment expected to detract significantly from growth until at least 2015-16.

Subdued outlook for non-resources business investment.

“There are both upside and downside risks to the economic outlook. Most notably, non-resources business investment could pick up earlier and more rapidly than expected following a prolonged period of caution... Conversely, the fall in resources investment is likely to be lumpy, while the associated rise in exports also has uncertain timing.”

Federal Budget 2014-15

51

Economic Outlook The above forecasts of unemployment levels reaching 6.25% by the middle of next year were exceeded by the sudden lift in the unemployment rate to 6.4% (seasonally adjusted) in July (as discussed earlier in this paper). The map below shows that in some parts of Australia, the unemployment rate is already above 7%.

Disappearing jobs (June to July)

5.2% was 5% WA

6.8% was 6.3% QLD

5.9% was 5.7% NSW

7.2% was 7.3% SA

7% was 6.6% VIC

7.6% was 7.3% TAS

6.4% was 6% AUSTRALIA

Source: Heath Aston, Gareth Hutchens and Max Mason, “Political blame flies as jobless rate rises”, The Age, 8 August 2014 (based on ABS, Labour Force, Australia, July 2014, Cat No 6202.0).

LOOKING AHEAD: WHAT ISSUES WILL DOMINATE THE WORKPLACE RELATIONS LANDSCAPE IN 2014-2015?

52


Bargaining in Key SectorsA number of significant bargaining and industrial action “flashpoints” have arisen over the last few months, which are likely to continue into the 2014-15 period:

• Ports/maritime industry in WA:

– Failed bargaining talks at DP World’s Fremantle port operations have led to the imposition of work bans and a proposed lockout,108 although more recently there are signs of an agreement being reached.109

– A planned 10-day strike at Mermaid Marine Australia’s Dampier wharf has potentially adverse implications for supply to Chevron’s Gorgon LNG project and BHP Billiton’s operations.110

– Negotiations at Teekay Shipping and Tidewater Marine have also resulted in some industrial action, with the potential for disputation affecting major resource exporters (BHP Billiton, Fortescue) leading the federal Government to:

– closely monitor the disputes111 (most likely with a view to potential exercise of the Minister’s power to end protected action on national interest grounds under FW Act, section 431);

– make a regulation enabling the WA Government and third parties to apply to the FWC seeking the termination of protected action in this and similar disputes affecting export shipments.112

• Curtis Island LNG projects: strike action has commenced on Bechtel construction sites over union claims for a three-weeks-on/one-week-off roster under new enterprise agreements (replacing the current four/one week arrangements).113 Like the WA port disputes, industrial action on the Curtis Island projects could lead to intervention by the federal and/or Queensland Governments.

• Negotiations at Devondale Murray Goulburn have seen protected industrial action taken by members of the CEPU and AMWU, with the dairy cooperative also bargaining with employees covered by the National Union of Workers.114

In addition, agreement negotiations are ongoing in the following sectors:

• Banking, including major employers CBA and Westpac where the Finance Sector Union is seeking to flow-on 4% per annum pay increases secured under a recent agreement with NAB.115

• Federal public sector agreements covering 160,000 employees expired in June. The Government has signalled a tough stance as part of its Budget savings measures, commencing with:

53

– proposals to reduce paid leave and increase working hours in the Department of Defence;116 and

– a proposed deal including minimal wage increases at the Department of Human Services (which covers employees in Centrelink and Medicare among many others).117

• Victorian manufacturing: the workplace determination settling the 2012 dispute at Schweppes expires in October this year. Agreements are also up for renegotiation at Amcor Flexibles and Carlton and United Breweries.

• Electrical contracting in Victoria: the current pattern agreement between the CEPU and the National Electrical and Communications Association (NECA) expires on 31 October 2014.118

• Construction including for major projects such as the East West Link in Victoria.

• The CEPU/NECA negotiations will have flow-on effects in the broader construction industry, with the CFMEU’s Victorian pattern agreement due to expire in 2015.

• In April, the CFMEU foreshadowed a number of concessions on demands for pay and conditions in negotiations to replace its WA pattern agreement which expires this year.119

Major Court and Tribunal Cases/DecisionsSeveral major employment and workplace relations cases will be heard and/or determined in the second half of 2014, including the following:

• The High Court will hand down its decision in the appeal against Commonwealth Bank of Australia v Barker [2013]. The decision will be important as High Court consideration of the implied term of trust and confidence in the Australian context has been long-awaited.

• The High Court will also hear the appeal against BHP Coal Pty Ltd v CFMEU [2013] FCAFC 132 (the CFMEU “scab sign” case). This will involve application (and possibly reconsideration) of the High Court’s earlier decision in Board of Bendigo TAFE v Barclay [2012] HCA 32.

• The Federal Court will deal with the application for judicial review of the FWC Full Bench majority’s May 2014 decision to reduce restaurant industry Sunday penalty rates.

• Penalty rate reductions will also feature prominently, along with employer efforts to obtain greater control over the taking of annual leave,120 in the FWC’s 4-Yearly Review of Modern Awards (under FW Act, section 156) which has already commenced.121


54


Coalition Government Reforms and Productivity Commission InquiryAssuming the Fair Work Amendment Bill 2014 is passed by the end of this year, it is likely the Government will then bring forward legislation to implement the remaining measures in its “Policy to Improve the Fair Work Laws”. These include:

• Further limits on the taking of protected industrial action, through the introduction of requirements that such action be preceded by genuine and meaningful discussions over a proposed enterprise agreement – and that protected action may only be taken in support of sensible and realistic claims.

• Requiring the FWC to ensure, when considering whether to approve an agreement, that productivity issues have been considered in the agreement negotiations. It is widely considered that formulating a workable requirement for the Commission to administer will be challenging. Some indication of the Government’s intentions in this area may be provided by the new Federal public sector bargaining guidelines, which link pay increases in departments and agencies to genuine productivity improvements, defined as: “demonstrable, permanent improvements in the efficiency, effectiveness and/or output of employees, based on reform of work practices or conditions, resulting in measurable savings”.

Pressure will no doubt build for the Government to introduce further reforms to the FW Act at the same time as the above amendments. However, the Government is not expected to advance further significant legislative changes until the Productivity Commission review of the workplace relations framework (PC Review) has concluded.

In early March 2014, the Government’s proposed terms of reference for the PC Review were leaked to the media. The draft terms of reference indicate that the Commission will be required to inquire into and make recommendations on a wide range of matters, including:

• the effects of the FW Act (and associated legislation) on the wellbeing, productivity and competitiveness of Australia and its people;

• the impact of the current workplace relations framework on matters such as employment levels, the ability of business and the labour marker to respond appropriately to changing economic conditions, and the ability of employers to flexibly manage and engage with their employees;

• how Australia’s workplace laws could be improved to maximise outcomes for all stakeholders, ensuring appropriate protections for workers, the need for businesses to be able to grow and prosper, and the need to reduce unnecessary regulation.

55

At the time of writing, the terms of reference had not been finalised, so the PC Review had not yet commenced. Recently, the Government rejected suggestions that it had delayed commencing the PC Review in order to focus on “selling” the 2014-14 Budget to the electorate; and repeated its commitment to completing the review in time to take any recommendations for legislative change to the next federal election in 2016.122

We anticipate that the PC Review will be the major focus of the IR reform debate in Australia over the next 12-18 months. While issues of major concern to employers like award penalty rates, individual agreements and unfair dismissal protections were not specifically mentioned in the draft terms of reference, they are sufficiently broad to enable those kinds of issues to be considered.

Given the Productivity Commission’s apparent openness to labour market reform,123 the PC Review is likely to result in more far-reaching recommendations than the 2012 FW Act Review. However, employers will need to make detailed submissions to the PC Review and contribute to the public debate which occurs alongside it,124 to make out the case for substantive changes to the current workplace relations system.

Possible Reform Directions for the Productivity Commission: Business Council of Australia Proposals 125

• Workplace relations should be focused on the enterprise

• Governance over regulation

• Focused solely on the employment relationship

• Protective of employee rights

• Responsive to changes in the economy


56

FOOTNOTES

1 Australian Government, Budget 2014-15 – Statement 2: Economic Outlook.

2 Annual Wage Review 2013-14 [2014] FWCFB 3500 (4 June 2014) at [135], referring to OECD, Economics: Key Tables from OECD, OECD iLibrary, Table No. 13, 4 April 2014, http://www.oecd-ilibrary.org/economics/economics-key-tables-from-oecd_2074384x.

3 Phillip Lowe, Deputy Governor of the Reserve Bank of Australia (RBA), Investment and the Australian Economy, Address to the CFA Australia Investment Conference, 24 October 2013.

4 Ibid.


6 ABS, Labour Force, Australia, May 2014, Cat No 6202.0.

7 ABS, Labour Force, Australia, June 2014, Cat No 6202.0.

9 James Bishop, Christopher Kent, Michael Plumb and Vanessa Rayner, “The Resources Boom and the Australian Economy: A Sectoral Analysis”, RBA Bulletin, March Quarter 2013.

10 Michael Pascoe, “Mining construction jobs to plunge by 78,000, study finds”, Sydney Morning Herald (BusinessDay), 16 December 2013, referring to the Australian Workforce and Productivity Agency’s 2013 resources skills study.

11 ABS, Wage Price Index, Australia, March Quarter 2014, Cat No 6345.0.

12 Ibid; and Michael Janda, “ABS figures show annual wages growth slowest on record”, ABC News, 19 February 2014, at: http://www.abc.net.au/.

13 Department of Employment, Trends in Enterprise Bargaining Report, March Quarter 2014; “Bargained wage rises still moderate, data confirms”, Workplace Express, 10 July 2014.

14 Senator Eric Abetz, Employment Minister, Industrial Relations after the Thirty Years War, Address to the Sydney Institute, 28 January 2014.

15 Annual Wage Review 2013-14 [2014] FWCFB 3500 (4 June 2014) at [270].

16 Luke Malpass, “Fear minimum wage will reduce Australia’s competitiveness”, The Australian Financial Review, 5 June 2014. See also “Australia penalising itself with high wages”, The Australian Financial Review, 14 May 2014; Ben Potter, “Wage freeze ‘worth another look’”, The Australian Financial Review, 29 April 2014; Mark Wooden, “How our minimum wage punishes those left at the bottom”, The Australian Financial Review, 6 June 2014.

17 “Global competitiveness, government regulation and productivity growth: Where does Australia rank?”, ABC News, 9 April 2014, at: http://www.abc.net.au/

18 Productivity Commission, PC Productivity Update, April 2014. See also Ben Potter, “Australia slips in global productivity rankings”, The Australian Financial Review, 29 April 2014; Patrick D’Arcy and Linus Gustafsson, “Australia’s Productivity Performance and Real Incomes”, RBA Bulletin, June Quarter 2012.

19 See also Australian Trade Commission, Australia posts sustained lift in labour productivity, Data Alert, 21 August 2013, at: www.austrade.gov.au

20 ABS, Employee Earnings, Benefits and Trade Union Membership, Australia, August 2013, Cat No 6310.0.

21 National Commission of Audit, Towards Responsible Government – The Report of the National Commission of Audit, Phase One (February 2014) and Phase Two (March 2014).

22 The Government has since rejected this recommendation: “Government rejects radical plan to slash minimum wage”, Workplace Express, 6 May 2013.

23 ACTU, Industrial Responses to the Budget 2014-15.24 See: http://www.corrs.com.au/thinking/insights/employment-and-industrial-relations-implications-arising-out-of-queenslands-

contestability-reforms/

25 Gary Sturgess, “Yes, minister, you can crank up the public service”, The Australian Financial Review, 15 June 2013; KPMG, Re-imagining public service delivery: A guide to new frameworks and thinking, November 2013; Michael Hiller, Federal Budget 2014: Contestability framework, KPMG, 2014.

26 Senator Eric Abetz, Employment Minister, Industrial Relations after the Thirty Years War, Address to the Sydney Institute, 28 January 2014; “Abbott points to work practices in denying SPC funding”, Workplace Express, 31 January 2014; “Abbott blames unions, Fair Work laws, for Toyota predicament”, Workplace Express, 11 February 2014; Phillip Coorey, “Spotlight back on IR debate”, The Australian Financial Review, 13 February 2014.

27 Marmara v Toyota Motor Corporation Australia Limited [2013] FCA 1351 (12 December 2013).

28 Toyota Motor Corporation Australia Limited v Marmara [2014] FCAFC 84 (18 July 2014): see: http://www.corrs.com.au/publications/corrs-in-brief/no-further-claims-provisions-do-not-prevent-proposed-variations-to-enterprise-agreements-toyota-decision-confirms/.

29 Warwick Long and Emma Griffiths, “SPC Ardmona denies it’s too generous to workers”, ABC Rural, 5 February 2014, at: http://www.abc.net.au/

http://www.oecd-ilibrary.org/economics/economics-key-tables-from-oecd_2074384x

http://www.abc.net.au/



www.austrade.gov.au

www.austrade.gov.au

http://www.corrs.com.au/thinking/insights/employment-and-industrial-relations-implications-arising-out-of-queenslands-contestability-reforms/

http://www.corrs.com.au/thinking/insights/employment-and-industrial-relations-implications-arising-out-of-queenslands-contestability-reforms/

http://www.corrs.com.au/publications/corrs-in-brief/no-further-claims-provisions-do-not-prevent-proposed-variations-to-enterprise-agreements-toyota-decision-confirms/





57

30 Australian Industry Group (AiGroup), Performance of Manufacturing Index, May 2014.

31 Julian Swallow and Jennifer Rajca, “Tony Abbott against debt guarantee for Qantas after 5000 jobs axed”, The Australian, 27 February 2014.

32 By mid-year, the Government had compromised on these proposed amendments, with the capacity for foreign ownership of the airline increased but only to a limit of 49%: James Massola, “Qantas to remain Australian as Coalition and Labor agree to limit increase in foreign ownership”, Sydney Morning Herald, 15 July 2014.

33 Julian Swallow and Jennifer Rajca, “Tony Abbott against debt guarantee for Qantas after 5000 jobs axed”, The Australian, 27 February 2014.

34 “Long haul for Qantas wage freeze plan?”, Workplace Express, 28 February 2014.

35 The Hon Tony Abbott MHR/Senator The Hon Eric Abetz, The Coalition’s Policy to Improve the Fair Work Laws, May 2013, at: http://www.liberal.org.au/latest-news/2013/05/09/coalitions-policy-improve-fair-work-laws

36 See: http://www.corrs.com.au/publications/corrs-in-brief/coalition-government-set-to-implement-policy-to-improve-the-fair-work-laws/

37 Liberal Party, The Coalition’s Policy for Better Transparency and Accountability of Registered Organisations, July 2013, at: http://www.liberal.org.au/better-transparency-and-accountability-registered-organisations

38 Liberal Party, The Coalition’s Policy for Paid Parental Leave, August 2013, at: http://lpaweb-static.s3.amazonaws.com/The%20Coalition%E2%80%99s%20Policy%20for%20Paid%20Parental%20Leave.pdf

39 This resulted, in March 2014, in the jailing for five years of former HSU East Secretary Michael Williamson for fraud; and the conviction (now the subject of an appeal) of former HSU National Secretary Craig Thomson for theft and obtaining property and financial advantage by deception.

40 “AiGroup rails against RO Bill’s ‘regulatory burden’”, Workplace Express, 26 November 2013.

41 Senate Education and Employment References Committee, Report on the Fair Work (Registered Organisations) Amendment Bill 2013 [Provisions], March 2014.

42 Phillip Coorey and Mathew Dunckley, “Abbott strikes while hot”, The Australian Financial Review, 29 January 2014; “Setka denies kickback claim”, Workplace Express, 30 January 2014.

43 See: http://www.tradeunionroyalcommission.gov.au/About/Pages/TermsofReference.aspx; and: http://www.corrs.com.au/publications/corrs-in-brief/royal-commission-into-trade-union-governance-and-corruption/

44 See: http://www.corrs.com.au/publications/corrs-in-brief/trade-unions-royal-commission-commences-in-sydney/

45 Royal Commission into Trade Union Governance and Corruption, Issues Paper 1: Whistleblower Protection, 13 June 2014.

46 Royal Commission into Trade Union Governance and Corruption, Issues Paper 2: Duties of Union Officials, 13 June 2014.

47 Royal Commission into Trade Union Governance and Corruption, Issues Paper 3: Funding of Trade Union Elections, 13 June 2014.

48 Royal Commission into Trade Union Governance and Corruption, Issues Paper 4: Relevant Entities, 23 July 2014.

49 See: http://www.corrs.com.au/publications/corrs-in-brief/back-to-the-future-abcc-set-to-return-under-building-and-construction-industry-improving-productivity-bill/

50 Grocon and Others v CFMEU and Others (No 2) [2014] VSC 134 (31 March 2014). The CFMEU has brought an appeal against this decision in the Victorian Court of Appeal.

51 Mathew Dunckley, Lucille Keen and Ben Potter, “RDOs used as an IR ‘weapon’”, The Australian Financial Review, 14 February 2014.

52 Productivity Commission, Public Infrastructure – Draft Report, March 2014. These findings were confirmed and elaborated upon in Productivity Commission, Public Infrastructure – Productivity Commission Inquiry Report, 27 May 2014, Volume 2.

53 See: http://www.corrs.com.au/publications/corrs-in-brief/abbott-government-releases-new-construction-code/

54 See eg “Unlegislated building code already taking effect”, Workforce, No 19162, 27 May 2014.

55 Michael Bleby and Mathew Dunckley, “CFMEU deal breaches federal code”, The Australian Financial Review, 17 June 2014.

56 “FWBC returns to ‘core business’, drops wages and sham contracting focus”, Workplace Express, 22 November 2013.

57 “Hadgkiss steps up union investigations”, Workplace Express, 30 May 2014.

58 “FWBC goes after individuals’ assets over unpaid entitlements”, Workplace Express, 29 May 2014; “FWBC pursues Noonan over Perth hospital project”, Workplace Express, 30 May 2014; “FWBC targets more building workers, while Heydon turns sights on Queensland”, Workplace Express, 29 July 2014.

59 See: http://www.corrs.com.au/publications/corrs-in-brief/government-commences-fair-work-act-reform/

60 “Ditch proposed greenfields benchmark, employers tell Abbott”, Workplace Express, 30 April 2014.

61 APPEA, Improving Labour Productivity: A Regulatory Reform Agenda, April 2014.

http://www.liberal.org.au/latest-news/2013/05/09/coalitions-policy-improve-fair-work-laws


http://www.corrs.com.au/publications/corrs-in-brief/coalition-government-set-to-implement-policy-to-improve-the-fair-work-laws/

http://www.corrs.com.au/publications/corrs-in-brief/coalition-government-set-to-implement-policy-to-improve-the-fair-work-laws/

http://www.liberal.org.au/better-transparency-and-accountability-registered-organisations

http://www.liberal.org.au/better-transparency-and-accountability-registered-organisations

http://lpaweb-static.s3.amazonaws.com/The%20Coalition%E2%80%99s%20Policy%20for%20Paid%20Parental%20Leave.pdf

http://lpaweb-static.s3.amazonaws.com/The%20Coalition%E2%80%99s%20Policy%20for%20Paid%20Parental%20Leave.pdf

http://www.tradeunionroyalcommission.gov.au/About/Pages/TermsofReference.aspx

http://www.corrs.com.au/publications/corrs-in-brief/royal-commission-into-trade-union-governance-and-corruption/

http://www.corrs.com.au/publications/corrs-in-brief/royal-commission-into-trade-union-governance-and-corruption/

http://www.corrs.com.au/publications/corrs-in-brief/trade-unions-royal-commission-commences-in-sydney/

http://www.corrs.com.au/publications/corrs-in-brief/back-to-the-future-abcc-set-to-return-under-building-and-construction-industry-improving-productivity-bill/

http://www.corrs.com.au/publications/corrs-in-brief/back-to-the-future-abcc-set-to-return-under-building-and-construction-industry-improving-productivity-bill/

http://www.corrs.com.au/publications/corrs-in-brief/abbott-government-releases-new-construction-code/

http://www.corrs.com.au/publications/corrs-in-brief/government-commences-fair-work-act-reform/

58


62 Australian Government, Towards more productive and equitable workplaces: An evaluation of the Fair Work legislation, June 2012. See: http://www.corrs.com.au/publications/corrs-in-brief/fair-work-act-review-report/

63 “Abbott cuts back on generosity of promised PPL scheme”, Workforce, No 19123, 30 April 2014.

64 Phillip Coorey, “Senators tell Hockey to axe parental leave”, The Australian Financial Review, 31 July 2014.

65 See: http://www.corrs.com.au/publications/corrs-in-brief/an-uncertain-future-for-the-governments-paid-parental-leave-scheme/

66 The Hon Tony Abbott MHR/Senator The Hon Eric Abetz, The Coalition’s Policy to Improve the Fair Work Laws, May 2013, at: http://www.liberal.org.au/latest-news/2013/05/09/coalitions-policy-improve-fair-work-laws

67 “Tribunal decisions inconsistent: Abetz”, Workplace Express, 21 November 2013.

68 “AMMA head steps up attack on FWC”, Workplace Express, 21 November 2013.

69 “Appeals body submissions to stay private; Ross stays out of debate”, Workplace Express, 3 June 2014.

70 “‘Inconsistency’ no basis for new appeal mechanism: Ross”, Workplace Express, 26 May 2014.

71 Senator The Hon Eric Abetz, “Public service wage bargaining”, Media Release, 28 March 2014.

72 Australian Public Service Commission, Australian Government Public Sector Workplace Bargaining Policy, March 2014, at: http://www.apsc.gov.au/aps-employment-policy-and-advice/workplace-relations/2014-workplace-bargaining-policy

73 Department of Employment. Revocation of the Fair Work Principles and the Commonwealth Cleaning Services Guidelines, 20 March 2014, at: https://employment.gov.au/news/revocation-fair-work-principles-and-commonwealth-cleaning-services-guidelines

74 In relation to all of the gender equity reporting changes, see Workplace Gender Equality Agency, About reporting, at: https://www.wgea.gov.au/report/about-reporting

75 “RSRT review handed to Abetz”, Workplace Express, 16 April 2014.

76 “Abbott minister indicates RSRT to be scrapped”, Workplace Express, 1 July 2014.

77 See the Terms of Reference for this Review at: http://www.alrc.gov.au/inquiries/freedoms/terms-reference

78 See: http://www.immi.gov.au/pub-res/Pages/reviews-and-inquiries/invitation-review-of-integrity-457.aspx; and “Labor’s 457 visa changes under review”, Workplace Express, 26 February 2014.

79 “Allseas Act still a political minefield”, Workplace Express, 3 June 2014. For background, see: http://www.corrs.com.au/publications/corrs-in-brief/allseas-amendments-to-migration-act-to-limit-international-workers-in-offshore-oil-and-gas-industry/

80 “Labor, Greens and minor parties combine to defeat offshore regulation”, Workplace Express, 17 July 2014; see also Joanna Mather, “Government tries to undo Senate vote”, The Australian Financial Review, 18 July 2014.

81 “Coalition reverses Senate vote on offshore resource project workers”, Workplace Express, 18 July 2014.

82 “Unions challenge offshore visa exemption”, Workforce, No 19252, 29 July 2014.

83 See: http://www.corrs.com.au/publications/corrs-in-brief/high-court-finds-provision-of-accommodation-is-not-a-payment-that-is-prohibited-during-industrial-action/

84 See: http://www.corrs.com.au/publications/corrs-in-brief/consultation-with-employees-why-what-and-when/

85 This decision has been appealed to the Full Federal Court.

86 The CFMEU has brought an appeal against this decision in the High Court of Australia. Further, the central issue underlying this litigation – the incompatibility between Federal and State building industry codes – will be resolved once the Abbott Government’s Building and Construction Industry (Fair and Lawful Building Sites) Code becomes operative.

87 Re Australian Education Union; Ex parte Victoria (1995) 184 CLR 188.

88 The UFU has brought a Full Court appeal against this decision.

89 See: http://www.corrs.com.au/publications/corrs-in-brief/federal-court-finds-agreement-scope-clauses-can-have-broad-application/. The CFMEU has sought judicial review of this decision in the Federal Court.

90 See: http://www.corrs.com.au/publications/corrs-in-brief/because-of-a-staple-the-agreement-was-lost-the-need-for-a-proper-notice-of-employee-representational-rights/

91 The employer has brought judicial review proceedings in the Federal Court in respect of this decision.

92 The ANF has brought a Full Court appeal against this decision.

93 This decision is the subject of judicial review proceedings in the Federal Court, brought by United Voice.

94 See: http://www.corrs.com.au/publications/corrs-in-brief/the-cowl-does-not-make-the-monk-can-an-employer-pay-employees-an-all-in-rate-covering-annual-leave-entitlements/

95 See: http://www.corrs.com.au/publications/corrs-in-brief/fair-work-act-amendments-passed-by-parliament-with-delayed-start-up-for-anti-bullying-provisions/ and http://www.corrs.com.au/thinking/insights/workplace-bullying-claims-will-increase-under-fair-work-commissions-anti-bullying-jurisdiction/

http://www.corrs.com.au/publications/corrs-in-brief/fair-work-act-review-report/

http://www.corrs.com.au/publications/corrs-in-brief/an-uncertain-future-for-the-governments-paid-parental-leave-scheme/



http://www.apsc.gov.au/aps-employment-policy-and-advice/workplace-relations/2014-workplace-bargaining-policy

http://www.apsc.gov.au/aps-employment-policy-and-advice/workplace-relations/2014-workplace-bargaining-policy

https://employment.gov.au/news/revocation-fair-work-principles-and-commonwealth-cleaning-services-guidelines

https://www.wgea.gov.au/report/about-reporting

https://www.wgea.gov.au/report/about-reporting

http://www.alrc.gov.au/inquiries/freedoms/terms-reference

http://www.immi.gov.au/pub-res/Pages/reviews-and-inquiries/invitation-review-of-integrity-457.aspx

http://www.corrs.com.au/publications/corrs-in-brief/allseas-amendments-to-migration-act-to-limit-international-workers-in-offshore-oil-and-gas-industry/

http://www.corrs.com.au/publications/corrs-in-brief/allseas-amendments-to-migration-act-to-limit-international-workers-in-offshore-oil-and-gas-industry/

http://www.corrs.com.au/publications/corrs-in-brief/high-court-finds-provision-of-accommodation-is-not-a-payment-that-is-prohibited-during-industrial-action/

http://www.corrs.com.au/publications/corrs-in-brief/high-court-finds-provision-of-accommodation-is-not-a-payment-that-is-prohibited-during-industrial-action/

http://www.corrs.com.au/publications/corrs-in-brief/consultation-with-employees-why-what-and-when/

http://www.corrs.com.au/publications/corrs-in-brief/federal-court-finds-agreement-scope-clauses-can-have-broad-application/

http://www.corrs.com.au/publications/corrs-in-brief/federal-court-finds-agreement-scope-clauses-can-have-broad-application/

http://www.corrs.com.au/publications/corrs-in-brief/because-of-a-staple-the-agreement-was-lost-the-need-for-a-proper-notice-of-employee-representational-rights/

http://www.corrs.com.au/publications/corrs-in-brief/because-of-a-staple-the-agreement-was-lost-the-need-for-a-proper-notice-of-employee-representational-rights/

http://www.corrs.com.au/publications/corrs-in-brief/the-cowl-does-not-make-the-monk-can-an-employer-pay-employees-an-all-in-rate-covering-annual-leave-entitlements/

http://www.corrs.com.au/publications/corrs-in-brief/the-cowl-does-not-make-the-monk-can-an-employer-pay-employees-an-all-in-rate-covering-annual-leave-entitlements/

http://www.corrs.com.au/publications/corrs-in-brief/fair-work-act-amendments-passed-by-parliament-with-delayed-start-up-for-anti-bullying-provisions/

http://www.corrs.com.au/publications/corrs-in-brief/fair-work-act-amendments-passed-by-parliament-with-delayed-start-up-for-anti-bullying-provisions/

http://www.corrs.com.au/thinking/insights/workplace-bullying-claims-will-increase-under-fair-work-commissions-anti-bullying-jurisdiction/

http://www.corrs.com.au/thinking/insights/workplace-bullying-claims-will-increase-under-fair-work-commissions-anti-bullying-jurisdiction/

59

FOOTNOTES

96 See: http://www.corrs.com.au/publications/corrs-in-brief/fwcs-anti-bullying-jurisdiction-past-conduct-is-relevant/; http://www.corrs.com.au/publications/corrs-in-brief/that-s-not-bullying-fair-work-commission-clarifies-key-aspects-of-new-workplace-bullying-laws/; and http://www.corrs.com.au/publications/corrs-in-brief/fwc-bullying-round-up-withholding-bonuses-not-bullying-more-on-reasonable-management-action-and-lawyers-welcome/

97 See: http://www.corrs.com.au/publications/corrs-in-brief/the-trojan-horse-the-new-implied-term-of-mutual-trust-and-confidence-in-australian-contracts-of-employment/; an appeal against the Full Federal Court majority’s decision has been heard before the High Court of Australia.

98 See: http://www.corrs.com.au/thinking/insights/social-media-private-life-and-work-life-collides-again/

99 Social Media Policy of the Department of the Prime Minister and Cabinet, 8 April 2014.

100 See: http://www.corrs.com.au/publications/corrs-in-brief/discharging-the-onus-in-adverse-action-claims-what-employers-can-do-in-the-post-barclay-environment/

101 The High Court has granted special leave to the CFMEU to appeal against the Full Federal Court majority’s decision.

102 See: http://www.corrs.com.au/publications/corrs-in-brief/who-employs-labour-hire-workers-fair-work-commission-rejects-the-concept-of-joint-employment/

103 See: http://www.corrs.com.au/publications/corrs-in-brief/federal-court-upholds-implied-contractual-right-to-require-medical-evidence/

104 See: http://www.corrs.com.au/publications/corrs-in-brief/the-new-untouchables-does-adverse-action-mean-that-some-employees-are-immune-from-dismissal/

105 Reserve Bank of Australia, Minutes of the Monetary Policy Meeting of the Reserve Bank Board, 3 June 2014.


107 Annual Wage Review 2013-14 [2014] FWCFB 3500 (4 June 2014).

108 Lucille Keen, “DP World to lock out port workers”, The Australian Financial Review, 30 July 2014.

109 “Bargaining ‘breakthroughs’ at CBA and DP World”, Workplace Express, 31 July 2014.

110 Julie-anne Sprague, “Mermaid boss lashes out at MUA strike”, The Australian Financial Review, 28 July 2014.

111 “Abetz stations officials in Pilbara to monitor Teekay bargaining blue”, Workplace Express, 22 May 2014.

112 Fair Work Amendment (Protected Industrial Action) Regulation 2014; the new regulation will be the subject of a motion for disallowance in the Senate, to be moved by the Greens on 1 September.

113 “Bechtel threatens lockout in battle over LNG project rosters”, Workplace Express, 3 July 2014.

114 “Dairy co-op seeks orders to halt industrial action”, Workplace Express, 17 July 2014.

115 “CBA pay offer below pacesetters: FSU”, Workplace Express, 18 July 2014. An agreement may be imminent at CBA: “Bargaining ‘breakthroughs’ at CBA and DP World”, Workplace Express, 31 July 2014.

116 Joanna Mather, “Defence to give up pay and hols”, The Australian Financial Review, 25 July 2014.

117 “Biggest department readying for vote on pre-inflation offer”, Workplace Express, 25 July 2014. The proposed vote on the agreement was recently delayed to allow for further negotiations including FWC conciliation: “DHS threatens to lower pay offer for delay”, Workforce, No 19252, 29 July 2014.

118 “AIG seeking to harmonise approach to pattern deals”, Workplace Express, 26 June 2014.

119 Jonathan Barrett, “CFMEU agrees to slash wages in WA” , The Australian Financial Review, 8 April 2014.

120 “Employers seeking annual leave changes in award review”, Workplace Express, 21 March 2014.

121 See: https://www.fwc.gov.au/awards-and-agreements/modern-award-reviews/4-yearly-review

122 “PC’s workplace inquiry going ahead ‘in timely manner’”, Workplace Express, 25 June 2014.

123 For a preliminary indication see Productivity Commission, Geographic Labour Mobility, Productivity Commission Research Report, April 2014, expressing concerns about the impacts of award regulation on flexibility and the capacity to engage labour in certain geographic areas. See also Productivity Commission, Public Infrastructure – Draft Report, March 2014; Productivity Commission, Public Infrastructure – Productivity Commission Inquiry Report, 27 May 2014, Volume 2.

124 See eg Business Council of Australia, Building Australia’s Competitive Advantage, July 2014, which argues (among other things) that penalty rates in hospitality and retail do not reflect “changed social norms and customer expectations”; and supports APPEA’s proposal that a new stream of major project agreements be created for major capital projects in the resource, energy and infrastructure sectors.

125 Ibid.

http://www.corrs.com.au/publications/corrs-in-brief/fwcs-anti-bullying-jurisdiction-past-conduct-is-relevant/

http://www.corrs.com.au/publications/corrs-in-brief/that-s-not-bullying-fair-work-commission-clarifies-key-aspects-of-new-workplace-bullying-laws/



http://www.corrs.com.au/publications/corrs-in-brief/fwc-bullying-round-up-withholding-bonuses-not-bullying-more-on-reasonable-management-action-and-lawyers-welcome/

http://www.corrs.com.au/publications/corrs-in-brief/fwc-bullying-round-up-withholding-bonuses-not-bullying-more-on-reasonable-management-action-and-lawyers-welcome/

http://www.corrs.com.au/publications/corrs-in-brief/the-trojan-horse-the-new-implied-term-of-mutual-trust-and-confidence-in-australian-contracts-of-employment/

http://www.corrs.com.au/publications/corrs-in-brief/the-trojan-horse-the-new-implied-term-of-mutual-trust-and-confidence-in-australian-contracts-of-employment/

http://www.corrs.com.au/thinking/insights/social-media-private-life-and-work-life-collides-again/

http://www.corrs.com.au/publications/corrs-in-brief/discharging-the-onus-in-adverse-action-claims-what-employers-can-do-in-the-post-barclay-environment/

http://www.corrs.com.au/publications/corrs-in-brief/discharging-the-onus-in-adverse-action-claims-what-employers-can-do-in-the-post-barclay-environment/

http://www.corrs.com.au/publications/corrs-in-brief/who-employs-labour-hire-workers-fair-work-commission-rejects-the-concept-of-joint-employment/

http://www.corrs.com.au/publications/corrs-in-brief/who-employs-labour-hire-workers-fair-work-commission-rejects-the-concept-of-joint-employment/

http://www.corrs.com.au/publications/corrs-in-brief/federal-court-upholds-implied-contractual-right-to-require-medical-evidence/

http://www.corrs.com.au/publications/corrs-in-brief/federal-court-upholds-implied-contractual-right-to-require-medical-evidence/

http://www.corrs.com.au/publications/corrs-in-brief/the-new-untouchables-does-adverse-action-mean-that-some-employees-are-immune-from-dismissal/

http://www.corrs.com.au/publications/corrs-in-brief/the-new-untouchables-does-adverse-action-mean-that-some-employees-are-immune-from-dismissal/

https://www.fwc.gov.au/awards-and-agreements/modern-award-reviews/4-yearly-review

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JOHN TUCK

Partner, MelbourneTel +61 3 9672 3257Mob +61 (0)434 181 [email protected]

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